Income Per Share

9 Months Ended

Sep. 30, 2021

Basic income per common share is computed by dividing net income by the weighted average number of common shares outstanding. Shares issued and treasury shares repurchased during the year are weighted for the portion of the year that they were outstanding. Diluted income per share is computed in a manner consistent with that of basic income per share while giving effect to all potentially dilutive common shares that were outstanding during the period. The outstanding relative performance stock units, non-vested restricted stock units, market stock units, and non-qualified stock options are not considered outstanding for purposes of computing basic income per share. However, these instruments are included in the denominator for purposes of computing diluted income per share under the treasury stock method. The Convertible Senior Notes are convertible, under certain circumstances, into the Company’s common stock, cash or combination thereof (at NRG's option). There is no dilutive effect for the Convertible Senior Notes due to the Company’s expectation to settle the liability in cash.

The reconciliation of NRG's basic and diluted income per share is shown in the following table:


	Three months ended September 30,				Nine months ended September 30,
(In millions, except per share data)	2021		2020		2021		2020
Basic income per share:
Net income	$	1,618	$	249	$	2,614	$	683
Weighted average number of common shares outstanding - basic	245		244		245		246
Income per weighted average common share — basic	$	6.60	$	1.02	$	10.67	$	2.78

Diluted income per share:


Net income	$	1,618	$	249	$	2,614	$	683
Weighted average number of common shares outstanding - basic	245		244		245		246
Incremental shares attributable to the issuance of equity compensation (treasury stock method)	—		1		—		1
Weighted average number of common shares outstanding - dilutive	245		245		245		247
Income per weighted average common share — diluted	$	6.60	$	1.02	$	10.67	$	2.77

As of September 30, 2021 and 2020 the Company had an insignificant number of outstanding equity instruments that are anti-dilutive and were not included in the computation of the Company’s diluted income per share.